How to use an alpha map in Blender Render?
How to use an alpha map in the Blender Internal Render Engine



In the Material context:

Enable "Transparency" and turn the Alpha slider down to 0. This means at its most transparent it will have zero visibility.

In the Texture context:

Set the Influence to be Alpha instead of Color. You'll probably want this slider to be at 1, since this controls the total transparency of the texture. If you lower it, even the opaque parts will become somewhat transparent.